Gold prices held firm near all-time peaks after US inflation came in cooler than expected, strengthening the case for Federal Reserve rate cuts. Traders are pricing in lower borrowing costs, which typically boost non-yielding assets like gold. The metal also found support from persistent geopolitical tensions that drive safe-haven demand.

Bullion's recent rally reflects shifting expectations around US monetary policy. Cooling inflation gives the Fed room to ease, weakening the dollar and pressuring Treasury yields. Historically, lower rates reduce the opportunity cost of holding gold, which pays no interest. Investors also buy the precious metal during global uncertainty as a store of value.

Markets now look to upcoming Fed meetings for signals on the timing and pace of cuts. Any hint of hesitation could test gold's momentum, while confirmed easing would likely extend gains. Traders will also monitor inflation reports and geopolitical developments for fresh catalysts. The next move in US rates remains the key driver for the yellow metal.